Low cost home ownership

This section provides a summary of the affordable housing schemes available through Housing Options.

You must specify which scheme you are interested in on your application form and may tick more than one option if appropriate.

Apply online at www.housingoptions.co.uk
or call 0845 230 8099
for an application form.

New Build HomeBuy

Shared ownership is now called New Build HomeBuy. This part buy/part rent scheme offers you the opportunity to get your foot on the ladder by buying a share in a brand new home. If you can afford to, you will be able to purchase more shares in the property until you own 100% of the property, this is called staircasing.

New Build HomeBuy properties are sold as leasehold properties on a shared ownership basis. These properties can be houses or apartments. You can buy anywhere between 25% usually up to 75% but this does differ with every development. You will have to secure a mortgage for the share of the property you intend to buy and pay a subsidised rent on the remaining share.

To sell the property you can go through your housing association. The property will be sold at the current market value. You will benefit from the equity which has been accrued on the share of the property you own.

HomeBuy Direct

With HomeBuy Direct you can purchase a brand new home with an affordable mortgage for a minimum of 70% of the market value of the property. The Homes and Communities Agency and a private developer jointly provide an equity loan of up to 30% to assist with your purchase. There are no payments on the loan for the first five years. After five years there is a fee of 1.75%, which will increase annually in line with inflation. You will need to raise a mortgage to purchase through this scheme. You can also use any savings you may have to contribute as a deposit towards your share.

You can buy additional shares at a later date until you own 100%. This is known as "staircasing" and is based on the current market value. If you wish to sell your property, the equity loan is repaid as a percentage of the market value at the time of sale.

Mychoice HomeBuy

(Previously known as shared ownership or part buy, part rent)
Through this scheme you can buy a share in a brand new or refurbished home.
You usually pay a mortgage on the part you own and a subsidised rent on the part you don’t own. As your income rises you can increase the share you own, until you eventually own 100% and no longer pay any rent to the housing association.
If you are a key worker and leave your profession within five years you will be required to either sell the property or purchase the entire remaining share of the property.

Rent to HomeBuy

Under the scheme, eligible households earning £60,000 a year or less will be able to rent a new home at specific new build developments, provided through housing associations. The rent will be payable at a discounted rate for a limited and defined period, after which time there will be an expectation that the property will be purchased on the terms of the New Build HomeBuy scheme.

The property is rented on the basis of an Assured Shorthold Tenancy. The affordable rent will be 80% of the market rent or less. This will enable the household to save for a deposit to later buy a share in the home.

Ownhome

This is a shared equity product offered by Places for People with The Co-operative Bank. Places for People could provide you with a shared equity loan of between 20% and 40% towards the purchase of a property on the open market to be used in conjunction with a mortgage from the Co-operative Bank in the first instance.

There are no interest payments for the first five years. After five years you would be charged a fixed rate of 1.75% interest on your Ownhome shared equity loan each year. After a further five years this would increase to a fixed rate of 3.75%.

For more information please contact Places for People on 0845 607 0110 or visit www.ownhome.co.uk.

First Time Buyer's Initiative

The First Time Buyers Initiative (FTBI) is part of the government’s new ‘HomeBuy’ low cost home ownership initiative.

The scheme applies to new build homes, and aims to make owning your own home more affordable. The way the FTBI works is simple. You buy your brand new home with an affordable mortgage and with government assistance. You have 100% ownership of your home and take out an affordable mortgage for a minimum of 50% of the full purchase price through a normal lender. The government then provides additional assistance to buy up to the full purchase price. Your mortgage repayments will be your only outlay for the first three years of ownership. After this time, the government (via a HomeBuy Agent) will charge a fee of 1% of the government’s contribution. This fee will rise to a maximum of 3% after five years in the property.

When owners sell their FTBI home, they will repay the government’s contribution by way of a share of the sale proceeds. So, if the government initially assisted the purchase with a 25% contribution, the repayment will be 25% of the total value when it is sold.

Social HomeBuy

This scheme provides new opportunities for existing housing association or local authority tenants to buy a share in their rented home.

Tenants can purchase a minimum initial share of 25 per cent of the home. The remaining equity will be retained by your landlord. Your landlord will then charge you an affordable rent on this remaining equity. The target average for the charge is 2.75%. It is also possible for you to purchase 100% of the property.

Buyers will receive a discount on the initial share purchase. This will be based on the Right to Acquire discount (between £9,000 and £16,000 - depending upon the local authority area in which the property is located), pro-rata to the share purchased.

Please contact your housing association or local authority landlord to find out if they are participating in the scheme. .